Tax Savvy Executives

59 Pages Posted: 15 Feb 2020

See all articles by Thomas R. Kubick

Thomas R. Kubick

University of Nebraska-Lincoln

Yijun Li

University of Kansas, School of Business, Accounting and Information Systems Area, Students

John R. Robinson

Texas A&M University; Texas A&M University - Department of Accounting

Date Written: October 30, 2019

Abstract

We investigate why firms include individuals with significant professional tax experience on their senior management team and the consequences associated with the presence of these tax-savvy senior executives. We find that past performance, network connections, geographic location, and tax rate level relative to industry peers are all significant determinants in having a tax-savvy executive on the senior management team. Using propensity score matching, we find that effective tax rates decrease substantially after a tax-savvy executive is added to senior management and revert following the departure of a tax-savvy executive from senior management. We connect the changes in effective tax rates to changes in the usage of foreign subsidiaries in low tax jurisdictions.

Keywords: corporate taxes, employment history, effective tax rates, professional experience

JEL Classification: G30, G31, G32, H25, M12

Suggested Citation

Kubick, Thomas R. and Li, Yijun and Robinson, John R., Tax Savvy Executives (October 30, 2019). Available at SSRN: https://ssrn.com/abstract=3522815 or http://dx.doi.org/10.2139/ssrn.3522815

Thomas R. Kubick

University of Nebraska-Lincoln ( email )

307 College of Business Administration
Lincoln, NE 68588-0488
United States

Yijun Li

University of Kansas, School of Business, Accounting and Information Systems Area, Students

1654 Naismith Dr.
Lawrence, KS 66045
United States

John R. Robinson (Contact Author)

Texas A&M University ( email )

mail stop 4353
Mays School of Business
college state, TX 77843-4353
United States
979-845-3457 (Phone)
979-845-0028 (Fax)

Texas A&M University - Department of Accounting ( email )

430 Wehner
College Station, TX 77843-4353
United States

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